After spinning off Sears Hometown (SHOS) and part of the company’s Canadian operations and now possibly the company’s warranty business, Balter argues, Lampert has pulled out too many blocks, such that the edifice will eventually come down:

Most investors conceive of and monitor Sears as a single unified entity. However, in reality Sears is an accumulation of many pieces, including 1,211 Kmart stores, 851 Sears stores, Lands’ End, Sears Canada, Sears Service, and brands like Kenmore, Craftsman and DieHard. Over the last few years Mr. Lampert has been slowly dismembering the corporation, taking pieces out much as players pull out pieces of a Jenga game, hoping the overall structure does not collapse. We believe what we saw this quarter, and what we are likely to see in the future, is that too many pieces have been removed, which in turn is reducing the strength of the core, and suggesting that further actions will weaken it even more.

Balter is now estimating it costs Sears potentially close to$10 per share each year just to continue operating:

We return to the question we ask each quarter. If the assets have so much value, why does Sears continue to operate? We used to believe that just operating costs the company about five dollars a share in negative cash flow each year, but based on Q1 results we now think that figure could potentially be closer to ten. The problem the company faces is that each time it offsets its liquidity shortfall, it pulls another brick of support to do so.

Shareholders are less than happy Friday; SHLD is down 14% at $49.84.

3: 51 p.m. update: A Sears spokesman writes in with this statement on the company’s business plan. I’m not sure how much it clarifies, but it’s worth a read by Sears-watchers:

We have clearly indicated that our primary focus is to transform our company into a leading integrated retailer that serves our members. As such, we are transforming our business to a member-centric business model and, in so doing, expect to improve our operating and financial performance. As part of that process we will consider alternative structures that allow us to unlock value in our asset portfolio when, at the same time, it allows our management to enhance our focus on serving our members. Any changes we might consider which involve a monetization of assets is part of our strategy to re-deploy assets in support of our transformation. Given our strong financial position and flexibility we only consider these actions when the value is appropriate and it is consistent with our strategy.

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Chris Dieterich has covered the U.S. stock market for The Wall Street Journal and Dow Jones Newswires. He is a graduate of Regis University and the Missouri School of Journalism.